RI-Japan Are Getting More Intimate, The Government Brings 4,500 IKM Products Into The Supply Chain Of The Automotive Industry

Illustration (Photo: Caradvice)

JAKARTA - The government through the Ministry of Industry is said to have succeeded in facilitating cooperation between Indonesian and Japanese automotive industry players to optimize economic potential in accordance with current global market needs. This was later realized through the holding of the Indonesia-Japan Autoparts Business Forum.

Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said the involvement of national business actors in the agenda was expected to have a broad impact on the Indonesian economy.

"From around 30,000 types of components or parts for cars, 15 percent or 4,500 types of components are likely to be supplied from IKM. However, currently only around 900 types of components have been supplied. Therefore, efforts are needed to increase the percentage, one of which is through business forums or business matching in the hope of introducing the capabilities of automotive component SMEs more," he said in a press statement, Tuesday, June 28.

According to the Minister of Industry, the government is determined to promote automotive component IKM and make it a strategic priority in the global automotive supply chain.

"The quality of IKM products in Indonesia, especially automotive, cannot be doubted. IKM products have obtained certificates such as ISO 9001, ISO 14001, ISO 18001, and others," he said.

The Minister of Industry added that the national automotive industry has absorbed up to 38.00 direct workers, as well as more than 1.5 million people who work along the sector's value chain, including small and medium-sized industries (IKM).

Meanwhile, Indonesia is targeted to become a global player in the automotive sector and as a motor vehicle export hub for fuel-based vehicles (internal combustion engines (ICE) and electric vehicles (EV).

"We believe that collaboration and coordination of all stakeholders is very important, especially in terms of increasing production efficiency and product competitiveness through the implementation of industry 4.0," he said.

In addition, the Minister of Industry said that a conducive business climate through harmonization and synchronization of regulations in the automotive sector can ensure that the principal's commitment to making Indonesia an export-oriented production base is fulfilled.

Several regulations have been enacted to accelerate emission reduction targets and to attract more investment in the automotive industry. These regulations include Presidential Regulation Number 55 of 2019 concerning the Acceleration of the Battery Electric Vehicle Program for Road Transportation.

Furthermore, Government Regulation Number 73 of 2019 JO 74/2021 concerning Taxable Goods Classified as Luxury in the Form of Motorized Vehicles Subject to Sales Tax on Luxury Goods. In addition, Minister of Industry Regulation Number 36 of 2021 concerning Low Carbon Emission Four-Wheel Motor Vehicles (LCEV).

"Hopefully this business forum will be the beginning of a fruitful partnership between IKM and automotive industry players in Japan," concluded Minister of Industry Agus Gumiwang.